Corporate Governance and Tax Planning Among Non-Financial Quoted Companies in Nigeria

Abstract

The study examined the impact of corporate governance on tax planning of non-financial quoted companies in Nigeria between 2004 and 2014.A sample of fifty (50) companies out of 151 non-financial quoted companies that covers 10 sectors were purposively selected on stratified random sampling basis. The data used in the analysis were collected from the audited financial statement of the selected non-financial quoted companies in Nigeria and Nigeria Stock Exchange Fact books and analysed using generalizes method of moments (GMM). The result showed that there is positive and significantly relationship between Effective Tax Rates (ETR) and firm value (TobinQ). The positive relationship as shown in the result implies that tax planning activities has not be benefiting the increase in firm value.All the variables such as leverage (LEV), Liquidity (LIQ), Net Working Capital (NWC), Growth opportunities (MTB) and capital intensity (CIN) were found to have a positive and significant relationship with the firm value.The recommendation thus is that firms need to institute more healthy tax planning practices and engage the services of professional tax consultants for higher firm value.

Key Words: Tax Planning, Effective Tax Rate, Firm Value, Nigeria